New York, NY (PRWEB) October 27, 2012
Michael Lombardi, financial expert and lead contributor to Profit Confidential, reports that the Chinese economy has seen its gross domestic product (GDP) grow significantly since 2008, but it’s now on track to see growth of only 7.7% this year and 8.2% in 2013. (Source: “MarketWatch,” The Wall Street Journal, last accessed October 14, 2012.) Lombardi points out that with the Chinese economy being based on exports, China’s increase in exports of only 2.7% in August (source: BBC News, September 10, 2012) suggests a decline in demand in the global economy and a move toward a worldwide recession.
Lombardi believes that a new wave of optimism has been created by the mainstream media and the financial gurus who are now claiming that the Chinese economy is turning around. Lombardi thinks their reasoning stems from the recently reported 9.9% increase in exports from China in September, compared to 2011. (Source: Bloomberg, last accessed October 14, 2012.)
“The Chinese economy is largely based on exports; if the exports increase, this means there is demand in the global economy,” explains Lombardi.
In the article “Is the Chinese Economy Really Recovering?,” Lombardi does note that this September’s increase is definitely a good signal for the Chinese economy, but in the grand scheme of things, he doesn’t believe it means much.
In periods of economic growth, the market needs to see consistent and less volatile results, explains the Profit Confidential expert. With exports increasing 2.7% in August, and 9.9% in September, Lombardi notes that the results are the opposite—inconsistent and volatile—which suggests a lack of strong economic growth.
Lombardi notes that the export numbers do suggest some demand from the global economy, but the eurozone, the biggest trading partner with the Chinese economy, is still struggling.
Lombardi concludes by stating that the global economy is edging closer to a global recession than a recovery: “If the Chinese economy is any indicator, it is suggesting the opposite of what the pundits are saying: don’t buy into the hype, look at the facts.”
Profit Confidential, which has been published for over a decade now, has been widely recognized as predicting five major economic events over the past 10 years. In 2002, Profit Confidential started advising its readers to buy gold-related investments when gold traded under $300 an ounce. In 2006, it “begged” its readers to get out of the housing market...before it plunged.
Profit Confidential was among the first (back in late 2006) to predict that the U.S. economy would be in a recession by late 2007. The daily e-letter correctly predicted the crash in the stock market of 2008 and early 2009. And Profit Confidential turned bullish on stocks in March of 2009 and rode the bear market rally from a Dow Jones Industrial Average of 6,440 on March 9, 2009, to 12,876 on May 2, 2011, a gain of 99%.
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Profit Confidential is Lombardi Publishing Corporation’s free daily investment e-letter. Written by financial gurus with over 100 years of combined investing experience, Profit Confidential analyzes and comments on the actions of the stock market, precious metals, interest rates, real estate, and the economy. Lombardi Publishing Corporation, founded in 1986, now with over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more on Lombardi, and to get the popular Profit Confidential e-letter sent to you daily, visit http://www.profitconfidential.com.
Michael Lombardi, MBA, the lead Profit Confidential editorial contributor, has just released his most recent update of Critical Warning Number Six, a breakthrough video with Lombardi’s current predictions for the U.S. economy, stock market, U.S. dollar, euro, interest rates and inflation. To see the video, visit http://www.profitconfidential.com/critical-warning-number-six.